Leave a legacy with donor-advised funds

    In my last column, I shared that the continuing out-migration of wealth is one of the greatest threats to the economic viability of Eastern Colorado. The Eastern Colorado Community Fund exists to keep these resources in our region, their place of origin, to impact lives for generations to come.
    We have all heard of large philanthropic foundations such as the Bill and Melinda Gates Foundation or the Boettcher Foundation. These foundations have been funded by the enormous wealth of individual donors, and each foundation has a sizeable staff to manage its investment and accounting activities.
    But few of us will ever need to have such large foundations. Many private (or family) foundations exist on a smaller scale but are similarly complex to create and administer. In addition, the IRS mandates strict rules that govern the foundation. Fortunately, there is another option to reach the same philanthropic goals — a donor-advised fund.
    Individual donor-advised funds are established within the structure of a larger, public charity. Professional staff handle all of the legal, accounting and investment aspects of the fund while giving the donor the highest-possible degree of involvement, flexibility and effectiveness. The result is a simpler way to achieve your charitable goals while benefitting from lower costs and greater efficiencies than a private foundation can offer.
    The annual cost for maintaining your fund ranges from 0.05 percent to 1.5 percent of the assets, depending on the size of the fund. All contributions to a donor-advised fund are tax-deductible irrevocable gifts. The fund can be increased over time with additional contributions from the donor, and the fund itself is created by signing a simple agreement.

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